Braid: Talks heat up as Kinder Morgan deadline approaches

B.C. Premier John Horgan, Attorney General David Eby and Environment Minister George Heyman meet with media to discuss filing a court case regarding oil jurisdiction in B.C. in Victoria on Thursday April 26, 2018. Chad Hipolito / The Canadian Press

Here we are in May, Kinder Morgan’s deadline month for staying with the Trans Mountain pipeline project.

The company vows to pull out by May 31 unless the B.C. government gives clear signs the project won’t be further obstructed.

With pressure building fast, federal and Alberta officials are meeting almost daily to work out some kind of ownership or backstop deal.

They convene in Ottawa and keep in regular contact with the company.

At this point, it seems unlikely that B.C. Premier John Horgan will meet Kinder Morgan’s condition by the end of the month — or ever.

These parties are farther apart than North and South Korea.

Last week, Horgan’s crew introduced new proposals to impose permits on bitumen shipments.

Kinder Morgan said the proposals “signal the province’s continued intention to frustrate the project.”

Both the Trudeau and Alberta governments have promised to save the Trans Mountain expansion with direct investment, and even public ownership, if necessary.

That’s what the talks in Ottawa are all about. They are said to be intense but positive.

To the Albertans, it’s understood that Ottawa will take the lead on any deal to buy out Kinder Morgan. If the feds are going to rescue this project, they want the credit.

The province’s role would be supportive, but could still include a large investment.

Predicting what happens in the next couple of weeks is risky business because the situation is “extremely volatile,” as one official said.

A key unknown is the impending Federal Court ruling on the validity of the National Energy Board approval.

The decision is running very late, forcing all the negotiations right up against Kinder Morgan’s deadline. “We could get it almost any second,” says another official.

There’s some chance that a solid court win for Alberta and Ottawa could change the dynamic, putting pressure on Horgan to ease up.

The Trudeau government might then break the logjam with a major promise: an increase in federal spending on marine safety, for instance.

If there’s a crack of light, Kinder Morgan might even extend its deadline.

But at this point, Horgan seems in no mood to relent. If he wants a friendship pact by May 31, he would hardly launch his own court reference on April 26.

The other possibility — a Federal Court decision with negative implications for the project — would likely kill any remaining hope of Kinder Morgan staying around.

As all this plays out, it’s very unlikely that Alberta will deploy Bill 12 to cut shipments of oil, gasoline and diesel fuel to the B.C. Interior and Lower Mainland.

Polls in B.C. show growing support for the pipeline; it’s now at 54 per cent, according to one survey.

Many British Columbians worry about the implications of blocking an approved national project.

Arguments about killing investment in B.C. are also taking hold.

Among 88 national signatories to an urgent letter asking Prime Minister Justin Trudeau to get the pipeline built, 19 were from B.C. organizations, including construction, tourism, chambers of commerce, oil and gas, mining, boards of trade, mayors and others.

A sudden choking of oil supply to B.C., even under new provocation from Horgan, could incite a backlash against Alberta and halt the surging support for the pipeline.

Alberta officials are already looking beyond May 31 to the sales job Premier Rachel Notley will face if the province spends billions on an ownership stake.

They’re calculating sales revenues that could come to the province once the pipeline is operating.

The idea of selling shares to the public — as the PCs once did with Alberta Energy Co. — is still being considered.

There’s risk in any public investment like this. But you can bet Kinder Morgan wouldn’t have stayed around this long if it didn’t expect massive profits.

The only certainty today is that the pipeline project won’t die on May 31. Failure could kill two governments. A lot of money will be spent to prevent that.

This Week's Flyers

Comments

We encourage all readers to share their views on our articles and blog posts. We are committed to maintaining a lively but civil forum for discussion, so we ask you to avoid personal attacks, and please keep your comments relevant and respectful. If you encounter a comment that is abusive, click the "X" in the upper right corner of the comment box to report spam or abuse. We are using Facebook commenting. Visit our FAQ page for more information.